Gold Set to End the Week Lower Near $4,300 an Ounce

Gold is heading for a lower weekly close near $4,300 an ounce, pressured by higher energy costs and growing expectations over the Federal Reserve’s interest-rate path.

Spot gold rose 0.2% to $4,283.34 an ounce at settlement, but remained more than 2% below its level last Friday.

Oil prices eased after surging more than 7% over the previous two sessions, as reports indicated that negotiators were discussing a phased agreement under which Iran could reopen the Strait of Hormuz while Washington lifts restrictions imposed on Iranian ports.

Higher energy costs have raised concerns over inflation and their potential impact on the Federal Reserve’s interest-rate decisions, weighing on gold in recent weeks. Investors are assessing whether persistent inflationary pressures could prompt the Fed to maintain higher borrowing costs. Higher interest rates typically weigh on gold because the precious metal does not generate interest income.

U.S. Treasury bonds also came under renewed selling pressure late Thursday, amid inflation concerns linked to the jump in oil prices, as well as broader worries over government debt.

Among other precious metals, silver gained 0.1% to $63.88 an ounce but remained on track for a weekly decline of more than 3%. Platinum edged higher, while palladium fell, and the Bloomberg Spot Dollar Index was broadly steady after five consecutive sessions of gains.